This article discusses the implementation of Enterprise Resource Planning (ERP) in Cisco, a leading information technology company. It explores the challenges faced by Cisco, the benefits of implementing ERP, and the company's attributes and business strategy. The article also provides a SWOT analysis of Cisco.
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Running head: ERP IMPLEMENTATION IN CISCO ERP Implementation in CISCO [Name of the Student] [Name of the University] [Author note]
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1ERP IMPLEMENTATION IN CISCO Table of Contents Introduction................................................................................................................................2 Discussion..................................................................................................................................2 Overview................................................................................................................................2 Case Background...................................................................................................................3 Salient facts about the case................................................................................................4 Economy and Industry.......................................................................................................5 Company Attributes...........................................................................................................5 Problem and key issues in the case........................................................................................9 Case Analysis.........................................................................................................................9 Management Recommendations and its implementation....................................................10 Working Schedule....................................................................................................................11 Gantt Chart:..............................................................................................................................13 Conclusion................................................................................................................................13 Bibliography:............................................................................................................................14
2ERP IMPLEMENTATION IN CISCO Introduction Cisco was founded by two scientists of Stanford computer in the year 1984 and since then it is at the top in the field of information technology. The story behind its establishment is that, two of its founder disappointed by not being able to email each other from two different office premises thought of developing Cisco Systems and came up with the multi- protocol router. At present, Cisco is involved in producing and transporting more than 35,000 components and is a master in developing designs and fabricating them, delivering and maintaining the production of near about 225 hardware products1. It has achieved the tag of being one of the pioneers of the networking equipment suppliers. They provide networking products as well as networking services. Cisco is dependent on nearly 600 suppliers throughout the world to manufacture, ship, recycle and test products developed by the company. Starting its initial operations from San Jose, California, the firm has expanded its roots to locations such as North America, Latin America, Europe, the Middle East and Africa. Discussion Overview Cisco faced certain challenges related to the UNIX-based software package that supports financial, manufacturing and order entries2. Cisco had included active acquisitions as a part of their companies growing strategy that has affected the software of the company. It did not take much time for Cisco to become the largest consumer of the UNIX software3. The present system lacked in redundancy, maintainability and reliability. The firm has maintained a growth rate of 80% but the abrupt regular shut down of the system led to the shortcomings. 1Harwood, Stephen.ERP: The implementation cycle. Routledge, 2017. 2Sun, Hongyi, Wenbin Ni, and Rocky Lam. "A step-by-step performance assessment and improvement method for ERP implementation: Action case studies in Chinese companies."Computers in Industry68 (2015): 40-52.3Almajali, Dmaithan Abdelkarim, Ra'ed Masa'deh, and Ali Tarhini. "Antecedents of ERP systems implementationsuccess:astudyonJordanianhealthcaresector."JournalofEnterpriseInformation Management29, no. 4 (2016): 549-565.
3ERP IMPLEMENTATION IN CISCO The legacy of the company failed drastically in the year 1994 and an urgent way out needed to be thought of4. The firm inferred from its downfall that an Enterprise Resource Planning is needed to be implemented. In order to implement the ERP planning an Information System strategy was made to excel in their operations. The project included its own problems, the team started working to respond to a quick deadline, and a costly budget was approved to make Cisco ready for the upcoming growth. Case Background The UNIX software was unable to provide Cisco with redundancy, maintainability and the company could not rely upon the software extensively for escalating its growth5. The failure of the software led to a sudden two days shutdown of the firm but still the managers did not take any heed to replace the faulty system and were not ready to address the problem for various reasons that have been listed below: 1.The governance policies of the company- Major of the expenditures related to the IT were assigned to separate functional areas and the core infrastructure expenses were made from the general overhead accounts6. A replacement of the system demanded heavy investment and no individual business unit was convinced to support the board. 2.ERP, time-consuming project- Implementing the system required huge efforts and time that could bring effective changes in various spheres of the firm. Initial research work on packaging, strategic planning and the budget of the project needed to be done before it could be presented to the board members. The support of the higher officials plays a vital role in the process. Skilled employees are required who could provide the 4Guerrero, Nenita D., and Shaneth C. Ambat. "Mining Students’ Performance in Cisco Networking Academy Program Using Apriori Algorithm."International Journal6, no. 11 (2016). 5Carrel, D., and L. Grant. "Operations T. Dahm Internet-Draft A. Ota Intended status: Standards Track Google Inc Expires: December 14, 2015 D. Medway Gash Cisco Systems, Inc." (2015). 6Ranjan,Shree,VijayKumarJha,andPralayPal."LiteraturereviewonERPimplementation challenges."International Journal of Business Information Systems21, no. 3 (2016): 388-402.
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4ERP IMPLEMENTATION IN CISCO proper definition of the operating practices of the company7. Divisional performance might suffer for this implementation, as Cisco will lose knowledgeable employees in fields where they excel. 3.Outcome of the process not known- Michael Hammer stated in his article that, “Reengineering Work: Don’t Automate, Obliterate”, that means restructuring has no certain results8. The company had achieved 80% annual growth rate and sudden reengineering could affect the success rate of the firm9. There are many surveys that have been cited in the article stating, ERP does not alter or cause any harm to the business. Salient facts about the case The primary product of the company was the router that had the characteristics of both hardware and software and it reached the atop in the industry at a rapid rate. The market capitalization of the company crossed the $100 billion mark in 1997 sales and was considered to become third dominating company after Microsoft and Intel. The UNIX based software package could not cope up with the redundancy and order of entries and was a hindrance to the success of the company. ERP system was opted for to solve the problem and it was successfully implemented, facing some challenges in the process. The two days abrupt shut down of the systems lead to the implementation of ERP. The challenges faced due to the restructuring of the system were that the newly implemented changes were unable to process the required amount of load and modifications made with respect to these. 7Ali, Mahmood, and Lloyd Miller. "ERP system implementation in large enterprises–a systematic literature review."Journal of Enterprise Information Management30, no. 4 (2017): 666-692. 8Sin, Muhammad Aizat Md, and Mohd Rizal Razalli. "THE INFLUENCE OF IT INFRASTRUCTURE IN BUSINESS PROCESS REENGINEERING PROJECT PERFORMANCE IN ISLAMIC BANKING."Jurnal Teknologi77, no. 4 (2015). 9Kirczuk, Lucyna, Anna Rymaszewska, Małgorzata Pilecka-Rapacz, and Józef Domagała. "Genetic variation in the ND1 gene and D-loop in protected and commercially exploited European cisco (Coregonus albula L.) populations."Folia biologica64, no. 4 (2016): 225-233.
5ERP IMPLEMENTATION IN CISCO Economy and Industry The changes being made in the business processes of the company was to bring in significant growth to the firm. It made use of the UNIX-based software package that could not provide the degree of redundancy, dependability and maintainability, which was essential for the company’s growth. It was not concerned to bring in change in the old systems but the incompetency of the software had left no other options other than changing the previous framework10. Compact researches were done and analyzed as well to select the vendors. Cisco compressed the field and included five packages in a time of two days and the candidates hired had to go through a tough evaluation process lasting for one week. Cisco wanted it’s vendors to respond to the company’s RFP and they were invited to the software demonstration program. Company Attributes Cisco system performs primary and support activities. Inbound logistics, outbound logistics, customer service, manufacturing operations and sales and marketing come under the primary activities of the firm. They are considered as the primary activities as they contribute directly to the company’s production and services. The value chain of Cisco is distributed, collaborative, demand driven and global. The company focuses on reducing costs and improving the operational excellence, by balancing goals related to supply chain. They accomplish the goals by focusing on meeting the needs of the customer and delivering value to them11. Cisco is a supplier-dependent company as they deal in outsourcing the strategies regarding the manufacturing of the products and do not have a strong hold on their deliveries. The company deals in numerous activities such as human resource management, procurement, infrastructure and technology. The design and planning department has a big 10Nordin, Norani, and Ojeniyi Adegoke. "Learning from ERP implementation: A case study of issues and challenges in technology management."Jurnal Teknologi74, no. 1 (2015). 11Singh,Chandan,RajdeepSingh,andHarleenKaur.AnalyticalStudyofthePerspectivesfor Implementation of ERP. LAP Lambert Academic Publishing, 2017.
6ERP IMPLEMENTATION IN CISCO contribution in the company’s expenditure. The expenditures of the company related to researchanddevelopmentintheyears2011and2010were$5.8and$5.3billion respectively12. The company designed new products in order to match the increasing demands of the customers. Procurement plays an important role in the organization’s activities in the support framework13. The company shares the Supplier Code of Conduct with all its suppliers in accordance to the procurement process and effectively sets certain expectations for their combined work. The suppliers are evaluated, self-assessments done and appropriate actions taken to check that the specific requirements are being met. The code of conduct revolves around ethics, environment, percepts of labor, health and safety and management systems. Business Strategy Cisco Systems deals in designing, manufacturing and selling Internet Protocol based networking.Itproducesproductsthatareapplicableforthecommunicationsandthe information technology industry and renders services related to these products. The company has employed over 70,700 employees and the revenue records showed figures up to $40,040 million in the financial year of July 201014. Cisco’s products are applicable for enterprises as well as home customers. The company has a numerous number of products in the portfolio thatincludesnetworkingsolutionsregardingapplicationsensuringsecureandreliable delivery within the data centers and across WANs. The company offers technical support services along with advanced services. SWOT Analysis 12Mora, Luca, Mark Deakin, and Alasdair Reid. "Smart-City Development Paths: Insights from the First Two Decades of Research." InInternational conference on Smart and Sustainable Planning for Cities and Regions, pp. 403-427. Springer, Cham, 2017. 13Bhati, Pratap Singh, and Munesh Chandra Trivedi. "Applicability and Impact of ERP: A survey." In2016 Second International Conference on Computational Intelligence & Communication Technology (CICT), pp. 28-31. IEEE, 2016. 14Krieg, Theodore M., Terri Lemons, and Cameron Welch. "An Overview of the Subsistence Fisheries of the Bristol Bay Area." (2015).
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7ERP IMPLEMENTATION IN CISCO SWOT analysis is an effective tool in strategic planning that Cisco can use to carry on the situational analysis of the firm. SWOT analysis helps to determine the internal and external strategic factors of an organization15. Strengths of Cisco- Cisco has a strong distribution network, has strong free cash flow that supplies resources to the company to develop new projects. The company maintains a consistent good quality of the products that it manufactures and has earned the trust of its customers16. The dealer community of the company is strong and has successfully come up with innovations in its products. The performance of the company in New Markets is superb, as it has become an expertise in the field. Weakness of Cisco- Cisco can make improvementsin its strategiesto overcome the weaknesses. Organization structure is not compatible with the new business model and the company should invest more on the new technologies being adopted. The company has failed to integrate firms with the different work cultural environment. Cisco lacks in choice of product range and it has always faced challenges when new products are launched. The firm’s investment in the field of research is low compared to that of its competitors. OpportunitiesforCisco-Thecashflowenablethecompanytomakeconsiderable investments in the new technologies and thus Cisco can add more products to its portfolio. The uptick in the economy and decreased growth rate can be taken as an opportunity to expand its market and gain the trust of the customers.The low inflation rate makes the market more stable enabling credit at a much lower rate to the consumers of Cisco. The new taxation system can help Cisco to increase its profits. 15Ervural, Beyzanur Cayir, Selim Zaim, Omer F. Demirel, Zeynep Aydin, and Dursun Delen. "An ANP and fuzzy TOPSIS-based SWOT analysis for Turkey’s energy planning."Renewable and Sustainable Energy Reviews82 (2018): 1538-1550. 16Balamurugan,S.,L.Jeevitha,A.Anupriya,andR.GokulKrubaShanker."FogComputing: SynergizingCloud,BigDataandIoT-Strengths,Weaknesses,OpportunitiesandThreats(SWOT) Analysis."Fog3, no. 10 (2016).
8ERP IMPLEMENTATION IN CISCO Threats to Cisco- The liability laws of different countries have different rules and Cisco might be affected by the change in policies in markets. The shift to online buying channel may pose a threat to the physical infrastructure based supply chain model. The new regulations under the Paris agreement (2016) regarding environment could be a possible threat to the product categories. Lack of skilled employees in certain areas may become a barrier in the company’s growth. The competitor’s in this industry are coming up with advanced technologies that could disrupt the market capture of Cisco. Any unwanted event during the peak seasons may adversely affect the profitability of the company. Organizational Structure and Culture According to John Chambers, the CEO of Cisco their organization structure enhances the interest of communities that are called councils and are considered $10 billion opportunities, consists of boards that are of $1 billion opportunities and various working groups17. In 2001, the deterioration of the economy of Cisco made the authorities realize that the hierarchical structure needed to be changed as it was acting as a speed breaker to the growth of the company18. Thereafter, the CEO grouped executivesinto cross- functional teams.Cisco’s organizational culture includes employee involvement, trust level inbuilt within the organization, decision-making group, empowering the employees, absence of micro level management and responsibility, accountability and authority. The work environment is good and includes recreational activities. The company provides its employeeswithflexibleschedulesandfrugalspending.Promotionandincentives motivate the employees and they are entitled to paid time off. Information Technology Architecture 17Sullivan, Brian. "2012 Bower Award for Business Leadership presented to John T. Chambers, Cisco Systems, Inc.| San Jose, California."Journal of the Franklin Institute352, no. 7 (2015): 2585-2586. 18PAtrIcIA rOdrígueZ, A. N. A. "on tHe FoUrtH oF JUly of 1968, my father landed at the San Fran-cisco InternationalAirportaboardaPanAmerican747,onthesame."USCentralAmericans:Reconstructing Memories, Struggles, and Communities of Resistance(2017): 41.
9ERP IMPLEMENTATION IN CISCO At the premises of Cisco, IT enables every single move that the firm makes. IT is in charge of the faster, better and low cost delivery of the business models. This strategy that has been undertaken, has transformed the traditional IT system to IT service system. IT service system refers to that type of architecture which delivers value defined by the business and is implemented in a cost effective manner, reducing the risk associated with it. The basic tenets of the company’s IT service model are: i.Business driven value ii.Cost effective iii.Customer-centric To run IT service model, a service portfolio and a catalog is essential. The services portfolio enables to manage the services throughout their lifecycle that includes the time when the product was conceived, the design was made, implementation of the work, operations done on it and the final product. Problem and key issues in the case The key issues in the case are: i.Operations related to primary activity, using UNIX-based software package exists in the firm and it lacks in redundancy, maintainability and reliability with the current system and the huge volumes of transaction. ii.In support activity, technology the UNIX-based software is highly customized. iii.With respect to financial infrastructure, the problem is the redundancy and reliability and the outages of the system. Case Analysis The ERP effortwassuccessful in Cisco, though some challengescamewhile implementing it. The new system was expected to act as a n effective support to the firm’s
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10ERP IMPLEMENTATION IN CISCO growth.TheproblemwithUNIX-basedsoftwarewassolvedbyselectingadiligent consultant and vendor. The KMPG partnered with Cisco had brought expertise of the industry and it was considered an opportunity to build the business using these applications19. Oracle was chosen as the vendor owing to its manufacturing skills, long-term development in the functions along with flexibility and encouragement. The target was achieved based on the five tracks that included, Order Entry Track, Technology Track, Finance Track, Sales Track andManufacturingTrack.ThesetracksincludedbusinessandITleadersandother consultants from Oracle, Cisco and KMPG and they represented each and every aspect of the company. The CRP model dealt with the efficiency as these were developed based on the previous work that gave a good understanding of the problem and how the previous software used to deal with it20. The project was given the highest priority and was considered one of the top goals of that year. The willingness to bring in the change made the task easier and the team selected was perfectly suited to carry on the work. The project also had some loopholes such as in the starting, the cutover to the system of Oracle was not stable and it used to shut down once in a day. The hardware problem was not addressed during CRP2 that is Conference Room Pilots. The system was being unable to handle the enormous volumes of transactions. Regular audit could have helped Cisco implement the process in a much effective way. The team did not want to make major software modifications and instead they found out that substantial changes needed to be done. The Oracle package needed to be changed in order to handle questions of the customer after the product was sold. Management Recommendations and its implementation The recommendations of the management was to build a definite structure before starting with any modifications because without a set of steps a project like this can face 19Du, Jun, and Mustapha Douch. "Infrastructure and Productivity: A Review." (2018). 20Liu, Li, Li Cheng, Ye Liu, Yongpo Jia, and David S. Rosenblum. "Recognizing complex activities by a probabilistic interval-based model." InThirtieth AAAI conference on artificial intelligence. 2016.
11ERP IMPLEMENTATION IN CISCO certain challenges like it did face in the process. A decision taken by the teams must be backed by realizable plans. In order to get the work done the leaders play a vital role as they are the ones who can motivate the employees to work in groups and step towards the company’s goal. Working Schedule Task ModeWBSTask NameDurationStartFinishPredecessors Auto Schedule d 0ERP Implementation at CISCO200 daysMon 5/13/19Fri 2/14/20 Auto Scheduled1Project initiation24 daysMon 5/13/19Thu 6/13/19 Auto Scheduled1.1Analyzing the project requirement7 daysMon 5/13/19Tue 5/21/19 Auto Schedule d 1.2Analyzing the ERP system requirement9 daysWed 5/22/19Mon 6/3/192 Auto Scheduled1.3Feasibility study5 daysTue 6/4/19Mon 6/10/193 Auto Scheduled1.4Identification of project risks3 daysTue 6/11/19Thu 6/13/194 Auto Scheduled2ERP planning phase88 daysFri 6/14/19Tue 10/15/19 Auto Scheduled2.1Identification of requirements6 daysFri 6/14/19Fri 6/21/195 Auto Scheduled2.2selection of resources18 daysMon 6/24/19Wed 8/21/197,5 Auto Scheduled2.3 Collection of rquirements from the resources 7 daysThu 8/22/19Fri 8/30/198 Auto Scheduled2.4Project planning development5 daysMon 9/2/19Fri 9/6/199 Auto Scheduled2.5Meeting arrangement with the project sponsors7 daysMon 9/9/19Tue 9/17/1910,9 Auto Scheduled2.6Project change management10 daysWed 9/18/19Tue 10/1/1911,7 Auto Scheduled2.7Appointing projet team members10 daysWed 10/2/19Tue 10/15/1912 Auto Scheduled3Project execution phase75 daysWed 10/16/19Tue 1/28/20 Auto Scheduled3.1System developmenet initiation6 daysWed 10/16/19Wed 10/23/1913 Auto3.2Analyzing the software6 daysThuThu 10/31/1915
12ERP IMPLEMENTATION IN CISCO Scheduledrequirements10/24/19 Auto Scheduled3.3Establishing connection with the online server8 daysFri 11/1/19Tue 11/12/1916,12 Auto Scheduled3.4SaaS cloud model selection10 daysWed 11/13/19Tue 11/26/1917 Auto Scheduled3.5Development of Mobile application10 daysWed 11/27/19Tue 12/10/1918 Auto Scheduled3.6User interface development8 daysWed 12/11/19Fri 12/20/1919 Auto Scheduled3.7ERP prototype development11 daysWed 12/11/19Wed 12/25/1919,10 Auto Scheduled3.8ERP prototype model verification9 daysThu 12/26/19Tue 1/7/2021 Auto Scheduled3.9ERP prototype model validation11 daysWed 1/8/20Wed 1/22/2022 Auto Scheduled3.10Prototype testing4 daysThu 1/23/20Tue 1/28/2023 Auto Scheduled4Closing phase of the project13 daysWed 1/29/20Fri 2/14/20 Auto Scheduled4.1Implementation of the ERP system10 daysWed 1/29/20Tue 2/11/2024 Auto Scheduled4.2Stakeholder signoff2 daysWed 2/12/20Thu 2/13/2026 Auto Scheduled4.3 developing secured relationship between the service provider and the employees 1 dayFri 2/14/20Fri 2/14/2027
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13ERP IMPLEMENTATION IN CISCO Gantt Chart: Conclusion Cisco Systems took a good decision to have the ERP implemented but the systems could be tested and validated in live environment to get better results.The ERP method would help the company in forecasting sales, creating manufacturing plans and making schedules to meet those targets. It will help to improve the communication between the cross- functional teams of the firm and the information is more relevant and timely.
14ERP IMPLEMENTATION IN CISCO Bibliography: Ali, Mahmood, and Lloyd Miller. "ERP system implementation in large enterprises–a systematicliteraturereview."Journal of Enterprise Information Management30, no. 4 (2017): 666-692. Almajali, Dmaithan Abdelkarim, Ra'ed Masa'deh, and Ali Tarhini. "Antecedents of ERP systemsimplementationsuccess:astudyonJordanianhealthcaresector."Journalof Enterprise Information Management29, no. 4 (2016): 549-565. Bhati, Pratap Singh, and Munesh Chandra Trivedi. "Applicability and Impact of ERP: A survey."In2016SecondInternationalConferenceonComputationalIntelligence& Communication Technology (CICT), pp. 28-31. IEEE, 2016. Carrel, D., and L. Grant. "Operations T. Dahm Internet-Draft A. Ota Intended status: Standards Track Google Inc Expires: December 14, 2015 D. Medway Gash Cisco Systems, Inc." (2015). Du, Jun, and Mustapha Douch. "Infrastructure and Productivity: A Review." (2018). Guerrero, Nenita D., and Shaneth C. Ambat. "Mining Students’ Performance in Cisco Networking Academy Program Using Apriori Algorithm."International Journal6, no. 11 (2016). Harwood, Stephen.ERP: The implementation cycle. Routledge, 2017. Kirczuk, Lucyna, Anna Rymaszewska, Małgorzata Pilecka-Rapacz, and Józef Domagała. "Genetic variation in the ND1 gene and D-loop in protected and commercially exploited European cisco (Coregonus albula L.) populations."Folia biologica64, no. 4 (2016): 225- 233.
15ERP IMPLEMENTATION IN CISCO Krieg, Theodore M., Terri Lemons, and Cameron Welch. "An Overview of the Subsistence Fisheries of the Bristol Bay Area." (2015). Liu, Li, Li Cheng, Ye Liu, Yongpo Jia, and David S. Rosenblum. "Recognizing complex activities by a probabilistic interval-based model." InThirtieth AAAI conference on artificial intelligence. 2016. Mora, Luca, Mark Deakin, and Alasdair Reid. "Smart-City Development Paths: Insights from the First Two Decades of Research." InInternational conference on Smart and Sustainable Planning for Cities and Regions, pp. 403-427. Springer, Cham, 2017. Nordin, Norani, and Ojeniyi Adegoke. "Learning from ERP implementation: A case study of issues and challenges in technology management."Jurnal Teknologi74, no. 1 (2015). PAtrIcIA rOdrígueZ, A. N. A. "on tHe FoUrtH oF JUly of 1968, my father landed at the San Fran-cisco International Airport aboard a Pan American 747, on the same."US Central Americans: Reconstructing Memories, Struggles, and Communities of Resistance(2017): 41. Ranjan, Shree, Vijay Kumar Jha, and Pralay Pal. "Literature review on ERP implementation challenges."International Journal of Business Information Systems21, no. 3 (2016): 388- 402. Sin, Muhammad Aizat Md, and Mohd Rizal Razalli. "THE INFLUENCE OF IT INFRASTRUCTURE IN BUSINESS PROCESS REENGINEERING PROJECT PERFORMANCE IN ISLAMIC BANKING."Jurnal Teknologi77, no. 4 (2015). Singh, Chandan, Rajdeep Singh, and Harleen Kaur.Analytical Study of the Perspectives for Implementation of ERP. LAP Lambert Academic Publishing, 2017. Sullivan,Brian."2012BowerAwardforBusinessLeadershippresentedtoJohnT. Chambers, Cisco Systems, Inc.| San Jose, California."Journal of the Franklin Institute352, no. 7 (2015): 2585-2586.
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16ERP IMPLEMENTATION IN CISCO Sun, Hongyi, Wenbin Ni, and Rocky Lam. "A step-by-step performance assessment and improvementmethodforERPimplementation:ActioncasestudiesinChinese companies."Computers in Industry68 (2015): 40-52. .